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Taiwan Faces Major Political Tilt
August 23, 2001

Summary
Former Taiwanese President Lee Teng-hui has helped launch a new political party. The new party could significantly affect Taiwan's political system as it will attempt to end the long-term parliamentary majority held by the nationalist Kuomintang party. If the new Taiwan Solidarity Union wins enough seats in December elections, it will impel President Chen Shui-bian and his Democratic People's Party to expand direct economic links with China while sidelining the issue of reunification with the mainland.

Analysis
A faction of Taiwan's nationalist Kuomintang (KMT) party split off to form a new political party, the Taiwan Solidarity Union (TSU), announced on Aug. 12. While remaining a KMT member, former President Lee Teng-hui proclaimed himself the moral and spiritual leader of the TSU, which aims to gain about 40 seats in Taiwan's 225-member parliament in December elections.

The formation of the TSU promises to significantly realign Taiwan's political system. The new party is expected to siphon off many votes from the KMT and the more pro-independence Democratic People's Party (DPP), to which President Chen Shui-bian belongs. Lee has urged the TSU to support Chen and the DPP.
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(c) 2001 Stratfor, Inc.

Dan